How can I buy Premium Bonds?

Apply By Phone – You can apply by phone by calling NS&I on 0500 500 000.

Apply By Post – Download and print the application form, fill it in and send to NS&I, Glasgow, G58 1SB along with your cheque.

When do new Premium Bonds enter the monthly draw?

New Premium Bonds have to wait for one full month before being entered into the next draw.

Since the draw happens at the start of the month, it could be anywhere from 5 to 8 weeks between your date of purchase and your first chance to win.

If you buy your new Premium Bonds in September, they need to wait until the same date in October, which means they will be entered into the November draw.

How much can you win with Premium Bonds?

The lowest prize is currently £25. The highest prize in Premium Bonds is £1,000,000.

Every Premium Bond is entered into every draw and every Premium Bond has an equal chance of winning a prize.

If one of your Premium Bonds wins a prize, that has no effect on the ability of any of your other Premium Bonds to win a prize that month.

If one of your Premium Bonds wins a prize this month, that does not affect the ability of that Premium Bond to win a prize next month. Each draw is separate and previous results have no bearing on future draws.

The 1.35% interest rate is used to fund the monthly prizes. Over 2 million Premium Bonds win a prize per month, including two mega prizes of £1,000,000.

As well as the top prizes, there are multiple winners of £100,000, £50,000, £25,000, £10,000, £5,000, £1,000 and £500, as well as lots of winners of the lower tier prizes of £100, £50 and the ubiquitous £25.

Benefits of Premium Bonds for higher rate taxpayers

If you are a higher rate taxpayer, there are advantages to the tax free nature of premium bond prizes.

With general savings accounts currently giving no more than 1.6% gross interest, this actually works out at just 0.96% after tax for higher rate taxpayers.

In contrast Premium Bonds offer an effective interest rate of 1.35% tax free. So higher rate taxpayers have the potential for a 0.4% boost from the tax free nature of premium bonds.

While this interest rate is applied to the entire fund, not your individual investment, assuming you have average luck and you have several thousand pounds to invest, higher rate taxpayers should be able to beat the standard taxable savings accounts.

How are Premium Bonds prizes paid?

Prizes from the Premium Bonds monthly draws can be paid out to you in a number of ways.

The default payment option for a Premium Bonds prize is that you receive a warrant (a cheque for all intents and purposes) posted to your registered address.

Alternatively you may choose the option of having your Premium Bond prizes paid directly into your bank account, rather than receing a cheque in the post. This does save the time and hassle of taking the Premium Bond warrant in to your bank and it means that you have access to the funds immediately rather than wauting a week for the cheque to clear.

A third option is having your Premium Bond prizes automatically reinvested into your Premium Bonds account. So instead of money in your bank account you have more Premium Bonds. These extra Premium Bonds behave exactly like Premium Bonds that you bought yourself and will be entered into future monthly draws, increasing your likelihood of winning further prizes.

If you win a prize and you already hold the maximum number of Premium Bonds you will receive a cheque / warrant instead.

Yes. If you already have the maximum holding of Premium Bonds and you win a prize, assuming your chosen payment option was reinvestment, it is no longer possible to reinvest that prize. So you will automatically receive a cheque posted to your home address.

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